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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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The Minister of State, Foreign and Commonwealth Office (Mr Hugo Swire)
It is a great pleasure to serve under your chairmanship this afternoon, Mr Hollobone, and I congratulate the right hon. Member for East Ham (Stephen Timms) on securing the debate. The right hon. Gentleman has a long-standing interest in such issues, as evidenced in his declaration in the Register of Members’ Financial Interests about his activities with Traidcraft, to which he alluded.
The Government’s aim in developing bilateral investment treaties is to provide a high level of protection for companies from one country that invest in the other country. In particular, we aim to ensure that British investors in a country with which we have a bilateral investment treaty will receive equal treatment compared with other foreign and domestic investors.
In general, the UK Government believe that such treaties have a positive impact, protecting investors against unfair expropriation and mistreatment, and encouraging investment. As the right hon. Gentleman said, however, bilateral investment treaties need to strike the right balance between providing protection for investors and giving Governments the space that they need to regulate in the public interest. The UK aims to achieve that balance in its treaties and, now that competence for foreign direct investment has transferred to the European Union, in treaties concluded by the EU.
To begin addressing some of the comments and questions of the right hon. Gentleman, increasing transparency in governance at home and internationally is a priority for the Government. Next week, I am pleased to say, we will be hosting the Open Government Partnership summit here in London, and that will be a key theme. We have also pushed for greater openness in investment arbitration, and I am pleased that new UN rules on transparency will enter into force next year. The hon. Member for Wigan (Lisa Nandy) made an intervention about redress in particular, but we will write to her with a fuller answer.
In response to the related concern about giving away privileges to distant tribunals, while the system is clearly not perfect—hence, for example, our work on transparency—overall we see such tribunals as positive. They have long been a feature of the international system and are considered generally to provide a dependable way for investors to achieve justice, where it cannot be achieved through the domestic legal system of the country in which they have invested. The tribunals are, therefore, important to guaranteeing investors’ rights and to preserving stable investment climates, which, in turn, help to encourage economic development. Without access to an international tribunal, such benefits would be lost. Furthermore, if we did not have tribunals, what should replace them? The right hon. Gentleman did not answer that question in his speech—I am happy to accept an intervention, should he wish to make one.
The right hon. Gentleman asked whether the Government intend to review their policy on investment protection. As I have mentioned, competence for foreign direct investment has now transferred to the EU. Since that transfer in 2009, the UK has not negotiated any new treaties. It retains the right to do so, but it has no immediate plans to negotiate new treaties. It does not, therefore, make sense for the UK to launch a full-scale review of our policy on such matters at present. That said, I reassure him that, in ongoing EU negotiations, we are pushing hard to achieve that important balance—guaranteeing fair treatment for investors, without an adverse impact on Governments’ rights to regulate in the public interest. That is also a principle that we will apply in any new treaties that the UK negotiates.
Our intention is to place before Parliament shortly a ratification instrument that will bring the UK-Colombia bilateral investment treaty into force. We believe that the treaty broadly achieves the right balance. Indeed, it includes specific provisions designed to preserve the right of the UK and Colombia to regulate for “reasons of public purpose”.
Stephen Timms
I am grateful for the way in which the Minister is responding to the debate. Will he explain the significance of the timing, given that he said that competence has moved to the European Union? I am told that the Colombia treaty was drafted almost 20 years ago. What is the significance of the timing, given that ratification will take place shortly?
Mr Swire
The right hon. Gentleman has more confidence in these matters than me. He referred to the next few weeks. I am reliably informed that it will be shortly, which is not necessarily in the next few weeks, but no doubt my colleagues in the Department for Business, Innovation and Skills will bring the matter to the House at the appropriate time and will be able to explain exactly, if I cannot. It is worth saying that the UK received authorisation from the European Commission to enter the Colombia treaty into force, as the right hon. Gentleman said, in spring 2013 and the Colombian note confirming its ratification in the summer.
The treaty is an important symbol of the close relationship that the UK has enjoyed with Colombia in recent years. To answer the right hon. Gentleman’s point about the importance of such treaties to the countries with which they are contracted, it is worth saying that the Government of Colombia is actively looking forward to the treaty being ratified. I believe that it is a positive move. It will cover all existing British investments in Colombia, which currently total £2.5 billion. The Government hope that when the treaty enters into force it will provide a further incentive for additional investment in Colombia by increasing the level of legal protection.
The right hon. Gentleman rightly raised a concern about the human rights situation in Colombia, including land rights. I assure him, as I have the House on a number of occasions when we debated the matter, that progress has been made, as noted in our 2012 human rights report. Around 170,000 victims have been provided with reparations under its victims and land restitution law and the Colombian Government are taking steps to reform the judicial system. We continue to press them to speed up the processing of cases and to eliminate impunity.
In 2012, experts from the Land Registry provided technical advice to the agriculture Ministry on land registration issues. Security for claimants and those returning to their land is a key concern, and our embassy in Bogota has funded a security risk analysis in potential restitution zones. However, almost five decades of conflict have caused many people to be displaced, as the right hon. Gentleman said. We welcome the significant progress made to date in the peace negotiations, in which provisional agreement on land reform has been reached.
I am grateful to the right hon. Gentleman for raising the concerns. The Government want bilateral investment treaties to provide a high level of protection for British companies investing in Colombia, but we also want to strike the right balance between providing protection for investors and giving Governments the space they need to regulate in the public interest. We are committed to supporting international efforts to increase transparency. We recognise that the current system of tribunals is not perfect, but it generally provides a dependable way for investors to achieve justice.
Competence for foreign direct investment has now transferred to the EU and the UK has not negotiated any new treaties since 2009, so we have no plans to review our policy on investment protection. However, in ongoing EU negotiations and any new treaties the UK negotiates, we will push for the right balance between investors and the public interest.
Question put and agreed to.